A product manager spent months working in dental practices to bring AI to small businesses. Then a16z led its $35 million round
The founder spent months working in dental practices, then personally set up the first 100 customers. Customers told investors its greatest value was recovering revenue they had been missing.
- Before a16z invested $35 million in the company, its founder spent months working in dental practices. His daily job was manually entering hundreds of insurance payments into their systems.
- Half of all AI agent activity is software engineering. Healthcare accounts for just 1%. That number is easy to misread.
- What customers valued most was not quite what the founder had pitched.
A product manager went to work in dental practices
On June 3, 2026, a16z announced that it had led a $35 million Series A in Lassie. The same day, it published the founder's account in its own outlet. The funding is not the real story. What makes this unusual is the level of operating detail: 700 US dental practices across 49 states and more than $10 million in annualized revenue. It also lays out, with unusual specificity, how to break into a vertical market. The playbook is deliberately unglamorous—and easy to copy.
The story began with a casual conversation. Steijn Pelle had moved from Amsterdam to San Francisco and worked as an early product manager at Robinhood. One day, his own dentist explained how the practice operated. Pelle was stunned: the dentist and his team spent 200 hours every month on administrative paperwork.
That is a full-time employee doing nothing but paperwork for an entire month—2,400 hours a year.
Nor was this an isolated case. Roughly 500,000 medical practices across the US face the same problem. Each spends about $200,000 a year on administrative roles that owners struggle to fill, much less retain.
After leaving Robinhood, Pelle took a real nine-to-five job for several months—first at a dental practice in Menlo Park, then at a gastroenterology practice in Scranton.
He compared himself to Jim Halpert from The Office. A typical day began by downloading a huge PDF from an insurer's website containing hundreds of payments. He would spend the next several hours entering every payment into the practice management system. Then he would print a 40-page list of hundreds of patients the system said were due for billing, check each balance, and generate the bills one by one.
Four photos from their time working in the practices. The filing-cabinet drawer on the far left is labeled "E.O.B.s" and is packed with Explanation of Benefits documents from insurers. The second image shows a dentist holding a stack of letters from Cigna. Image: a16z News.
Matching payments to insurance claims takes 200 hours a month
"Administrative paperwork" is too vague to explain what the AI actually took over. Money moves through a US dental practice along the path below. Pelle's account only sketches the beginning; we reconstructed the full workflow from public sources.
Practice management system (PMS)
The practice's core system. It serves as both the clinical record and the ledger, tracking who received care, which procedures were performed, how much was paid, and what remains outstanding.
Insurance claim
After treating a patient, the practice submits a request for payment to the insurer, listing the procedures performed and the amount owed under the contract.
Claims clearinghouse
An intermediary between practices and insurers. It converts claims from each practice's format into the format each insurer accepts. Think of the clearing layer behind interbank transfers: when the two sides do not speak the same language, someone has to translate.
Electronic funds transfer (EFT)
The insurer deposits money directly into the practice's bank account, replacing the paper checks traditionally sent by mail.
Explanation of Benefits (EOB) / Electronic Remittance Advice (ERA)
An EOB explains coverage and payment to the patient. An ERA is the electronic payment detail an insurer sends to the practice, showing which patients and procedures a payment covers, how much was paid, and what was denied. The drawer labeled "E.O.B.s" in the photo above held these records.
Here is how a dental bill moves through that system:
The patient receives care, and the practice records each procedure in its PMS
Fillings, extractions, and X-rays each have a code and a price
The practice submits an insurance claim through a claims clearinghouse
The clearinghouse converts it into the insurer's accepted format
The insurer reviews the claim, pays, and sends payment details
Payment arrives by EFT or paper check; the EOB or ERA explains what was paid or denied
The incoming payment is matched to the claims originally submitted
Each reconciled item is then posted back to the PMS
Manual bottleneckIf insurance pays only part, the remainder is calculated and billed to the patient
That 40-page list was produced at this stage
Denied and underpaid claims are identified and appealed individually
Missed claims become lost revenue
Also manualThe payment workflow at a US dental practice, reconstructed from public sources. Step 4 consumes most of those 200 hours. Step 6 is where revenue can disappear outright.